t economic headwinds, with interest rate policy, tariff tensions, and consumer sentiment all under scrutiny. While the former president had previously clarified he doesn’t plan to fire Powell, his consistent public criticism raises fresh concerns about the independence of the Federal Reserve.
Legal experts are now watching a Supreme Court case involving Trump’s prior firing of two federal labor board officials, which could set a precedent on presidential power over independent federal agencies—including the Fed.
Powell Holds His Ground as Economic Pressures Mount
Jerome Powell, who was appointed by Trump in his first term, has remained firm in his stance. The Federal Reserve has already slashed interest rates by 1% through 2024 to combat inflation but signaled a slower pace of cuts going into 2025 due to persistent inflation risks and the unpredictable impact of Trump’s aggressive trade tariffs.
While Powell has stated he will serve his full term until May 2026, mounting political pressure and economic uncertainty could alter the Fed’s course. Should the U.S. economy falter further under Trump’s economic policies, the central bank might be forced to accelerate rate cuts to avoid recession.
What This Means for Markets
For forex traders and investors tracking U.S. dollar volatility and monetary policy shifts, Trump’s escalating rhetoric against the Fed and Powell is a signal to stay alert. Interest rate forecasts, Fed independence, and trade war developments will be key drivers of market sentiment in the coming months.
Stay tuned to www.dailyforex.pk for real-time updates on the Federal Reserve, U.S. politics, and their impact on gold, currencies, and global financial markets.